Correlation Between Shanxi Lanhua and Chengdu Xingrong
Specify exactly 2 symbols:
By analyzing existing cross correlation between Shanxi Lanhua Sci Tech and Chengdu Xingrong Investment, you can compare the effects of market volatilities on Shanxi Lanhua and Chengdu Xingrong and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Shanxi Lanhua with a short position of Chengdu Xingrong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanxi Lanhua and Chengdu Xingrong.
Diversification Opportunities for Shanxi Lanhua and Chengdu Xingrong
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanxi and Chengdu is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Shanxi Lanhua Sci Tech and Chengdu Xingrong Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Xingrong Inv and Shanxi Lanhua is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Shanxi Lanhua Sci Tech are associated (or correlated) with Chengdu Xingrong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Xingrong Inv has no effect on the direction of Shanxi Lanhua i.e., Shanxi Lanhua and Chengdu Xingrong go up and down completely randomly.
Pair Corralation between Shanxi Lanhua and Chengdu Xingrong
Assuming the 90 days trading horizon Shanxi Lanhua Sci Tech is expected to generate 0.61 times more return on investment than Chengdu Xingrong. However, Shanxi Lanhua Sci Tech is 1.63 times less risky than Chengdu Xingrong. It trades about -0.24 of its potential returns per unit of risk. Chengdu Xingrong Investment is currently generating about -0.42 per unit of risk. If you would invest 783.00 in Shanxi Lanhua Sci Tech on December 8, 2024 and sell it today you would lose (25.00) from holding Shanxi Lanhua Sci Tech or give up 3.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanxi Lanhua Sci Tech vs. Chengdu Xingrong Investment
Performance |
| Timeline |
| Shanxi Lanhua Sci |
| Chengdu Xingrong Inv |
Shanxi Lanhua and Chengdu Xingrong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanxi Lanhua and Chengdu Xingrong
The main advantage of trading using opposite Shanxi Lanhua and Chengdu Xingrong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanxi Lanhua position performs unexpectedly, Chengdu Xingrong can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Chengdu Xingrong will offset losses from the drop in Chengdu Xingrong's long position.| Shanxi Lanhua vs. Zhejiang Kingland Pipeline | Shanxi Lanhua vs. Zhejiang Jiecang Linear | Shanxi Lanhua vs. Tungkong | Shanxi Lanhua vs. Huatai Tianjin Huatai |
| Chengdu Xingrong vs. Rising Nonferrous Metals | Chengdu Xingrong vs. Hengyi Petrochemical Co | Chengdu Xingrong vs. Shanghai Yanpu Metal | Chengdu Xingrong vs. Shanghai Jinfeng Wine |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |